Progress on Our Finance and Budget Strategies

Provost Barbara Bichelmeyer and Chief Financial Officer Jeff DeWitt
Monday, March 4, 2024, 11:10 a.m.
KU Lawrence Faculty, Staff and Affiliates

Dear Colleague,

We want you to know we are working diligently to achieve our shared goal to get each of our employees to market pay as quickly as possible. At the same time, we must continue to make progress on eliminating the structural deficit and addressing maintenance and repair of our facilities.

Together, these three goals — eliminating our deficit, increasing pay and improving facilities — are our greatest financial priorities. We simply cannot achieve any of these goals without your participation. So, we’re writing today to give you a progress update and to ask for your help in generating revenue, savings and cost-shifting activities that support our collective efforts at KU Lawrence and Edwards.

While financial pressure across higher education continues, KU has engaged in many initiatives to improve our financial standing. We have developed a five-year financial plan in alignment with our Jayhawks Rising objective to “Ensure Stewardship of the Institution” under the “Healthy and Vibrant Communities” priority. We deeply appreciate everyone’s efforts over the past several years as we’ve made significant progress in reducing our structural deficit from the $50 million in FY2021.

As we discussed in this week’s Chancellor’s Weekly Video, as well as other public forums and presentations, one of our top priorities for FY2025 is to eliminate the structural budget deficit of KU Lawrence and Edwards. The structural budget deficit means we are spending more money than we are bringing in, and one-time savings are being used to bridge the gap. In the current fiscal year, we will spend $14.6 million from campus savings to offset the deficit. If we don’t achieve strategic initiatives designed to generate additional revenue and reduce expenses, our savings will be fully exhausted by June 2025 and we will be required to cut general fund budgets. Several initiatives are underway to generate new revenue and place increased emphasis on fiscal discipline in spending campus resources.  

Initiatives we are collectively working on to generate new revenues include:

  • Strategic enrollment management
  • Online program expansion through Jayhawk Global
  • Launch of new competency based educational (CBE) programs
  • Conferences and events

Initiatives underway to manage spending and support fiscal discipline include:

  • Redesign of budget practices
  • Strategic hiring
  • Procurement reform
  • Implementation of a Finance Service Portal
  • All funds budgeting
  • Pay in 30
  • Continuous improvement (Jayhawks Elevate)

Achieving Our Priorities for Spending and Fiscal Discipline

Our ability to achieve our fiscal priorities depends on working collaboratively at all levels on the above initiatives. In some cases, KU leaders and the Finance unit are the primary drivers, while in other cases faculty and staff across the our campuses are key participants.

Redesign Budget Practices

Primary: Unit leaders and budget officers

Our budget planning must support Jayhawks Rising and the five-year financial plan. As the budget is developed for FY2025, we are making several changes that will provide a more comprehensive view of funding sources as reflected in the five-year plan. The updated budget practices will show unit budgeting for all filled positions and a more detailed view of operating expenditures. This transparency will allow Procurement to partner with units to purchase high-quality products and services at optimal pricing.

Strategic Hiring

Primary: Unit leaders and all faculty and staff

A significant portion of the budget is dedicated to our valuable employees who carry out the mission of KU. The strategic hiring plan will not change current staffing and will not result in the elimination of filled positions. Strategic hiring means each unit leader will develop a staffing plan that defines the positions and people needed to achieve the unit’s strategy, mission and goals.

Senior leadership will review the hiring plans and use them as a foundation for campuswide staffing plans to help ensure we are strategically investing in people and positions across the entire institution. Strategic hiring is not designed to eliminate filled positions, rather to evaluate vacant positions based on current and future needs instead of simply refilling open positions out of habit or based on outdated needs.

Procurement Reform 

Primary: All faculty and staff

Similar to staffing, we spend substantial money on operating budgets, including supplies, travel, hardware, software and professional services. The Finance team has proposed changes to policies and procedures that will increase visibility and allow us to leverage our collective spending to achieve cost savings across campus. Significant changes include a three-quote requirement and additional negotiations with suppliers for purchases between $10,000-$50,000, review of all software transactions, and discretion to deny expenditures to ensure purchases are consistent with general fiscal discipline and financial constraints regardless of dollar value or source of funds.

Finance Service Portal 

Primary: All faculty and staff

KU is a large, comprehensive and complex organization. We consume many goods and services, enter into a wide range of contracts, and travel extensively in support of our academic and research mission. These transactions require communication and participation among many stakeholders across campus, often resulting in lots of back and forth. The purpose of the Finance Service Portal is to standardize these activities and define the information needed to complete transactions. The Finance Service Portal has been tested in 10 departments across campus over the past six months, and we plan to introduce this process to the entire campus over the remainder of the fiscal year.  

All Funds Budgeting

Primary: Unit leaders and budget officers

Even if you’re not involved in managing a unit budget, you might have heard the term “all funds budgeting” but not know what it means. Funding for most academic units comes from a variety of sources: state funding, research grants, KU Endowment funding, generated revenue and more. Many of the funding sources have restrictions on how the money can be spent. Historically, many units have spent unrestricted funds first and had large carryover balances in some of their restricted funds. All funds budgeting encourages units to first spend restricted funds for their intended use, so that more flexible unrestricted funds can be conserved and allocated toward competitive pay and pay increases.

Pay in 30

Primary: Budget officers and Finance unit staff

Just like at home, paying bills in a timely manner is a best practice for organizations. Unfortunately, that doesn’t always happen at KU. In addition to frustrating those who are owed money, delayed payments have real financial costs. Some vendors provide a discount for payments made within a set timeframe, and many charge fees for late payments. In addition, delayed payments affect employee reimbursement and payments to visiting scholars, speakers and other individuals.

The Pay in 30 project is addressing the challenges and barriers that delay payments with the goal of making all payments within 30 days after an invoice or reimbursement request is submitted.

Continuous Improvement

Primary: All faculty and staff

We are currently rolling out Jayhawks Elevate, our continuous improvement initiative that asks you to submit ideas for increasing revenue, decreasing costs, or just making what we do every day more efficient. You can submit ideas through the Jayhawks Elevate portal, where you also can view and track the status of all submitted ideas.

Positive Indicators

In addition to cost savings and good stewardship, increased revenue is critical to eliminating our structural deficit and providing budget stability. We are fortunate recently to have positive growth in two important areas: enrollment and state support.

Increased Enrollment

As you know, this academic year KU had our largest freshman class in history and our highest overall enrollment in 13 years. That is extremely positive news, bringing additional tuition revenue to help meet our budget goals. However, that tuition growth was partially offset by additional costs to accommodate more students, including housing, instructional costs, transportation and financial aid. Still, in a time when many institutions are facing declining enrollments, we are fortunate to have the “challenges” of accommodating new Jayhawks!

State Support

We are grateful to the Kansas Legislature and Governor Laura Kelly for the stronger funding support we’ve seen for higher education in the past couple of years. Our state leaders have invested more in higher education overall, and have made targeted investments in important projects like the KU Cancer Center, the KU-Wichita State medical campus, and information technology and security improvements. In addition, state leaders have provided funding for employee pay increases the past two years. The outstanding work KU faculty, staff and researchers do every day continues to demonstrate the positive return on these state investments in KU and higher education in general.

Let’s Elevate Our Success

As mentioned above, we are in the process of rolling out Jayhawks Elevate, our effort to establish a practice of continuous learning and improvement. Our goal is to empower everyone to learn and improve the way our institution functions and help identify cost savings and revenue opportunities to help fund competitive pay and annual pay increases.

Several large units have already piloted this program with great success. In the coming weeks, we will share more information about Jayhawks Elevate and how, collectively, we can share, assess and implement innovative ideas for improving our organization.

Thanks to Each of You

Our goal is to provide transparency and share information in a way that is meaningful and relevant (though we recognize that not everyone is as energized about budget and structural deficit talk as we are). We hope you find the information helpful, and we encourage you to reach out with questions, comments and ideas.

We appreciate the work each of you do every day to help KU be an exceptional learning community that lifts each member and advances society. Regardless of your specific job, you are helping to change lives in profound and positive ways. Thank you for all you do!


Barb and Jeff

Barbara Bichelmeyer
Provost and Executive Vice Chancellor

Jeff DeWitt
Chief Financial Officer